The oil giant Exxon Mobil, whose chief executive once mocked alternative energy by referring to ethanol as “moonshine,” is about to venture into biofuels.

On Tuesday, Exxon plans to announce an investment of $600 million in producing liquid transportation fuels from algae — organisms in water that range from pond scum to seaweed. The biofuel effort involves a partnership with Synthetic Genomics, a biotechnology company founded by the genomics pioneer J. Craig Venter.

The agreement could plug a major gap in the strategy of Exxon, the world’s largest and richest publicly traded oil company, which has been criticized by environmental groups for dismissing concerns about global warming in the past and its reluctance to develop renewable fuels.

Despite the widely publicized “moonshine” remark a few years ago by Exxon’s chairman and chief executive, Rex W. Tillerson, the company has spent several years exploring various fuel alternatives, according to one of its top research officials.

“We literally looked at every option we could think of, with several key parameters in mind,” said Emil Jacobs, vice president for research and development at Exxon’s research and engineering unit. “Scale was the first. For transportation fuels, if you can’t see whether you can scale a technology up, then you have to question whether you need to be involved at all.”

He added, “I am not going to sugarcoat this — this is not going to be easy.” Any large-scale commercial plants to produce algae-based fuels are at least 5 to 10 years away, Dr. Jacobs said.

Exxon’s sincerity and commitment will almost certainly be questioned by its most galvanized environmentalist critics, especially when compared with the company’s extraordinary profits from petroleum in recent years.

“Research is great, but we need to see new products in the market,” Kert Davies, the research director at Greenpeace, said. “We’ve always said that major oil companies have to be involved. But the question is whether companies are simply paying lip service to something or whether they are putting their weight and power behind it.”

But if it proves a bona fide effort, Exxon’s move into biofuels, long the preserve of venture capital firms and biotech start-ups, could provide a big push to the Obama administration’s policy of encouraging more renewable energy.

Currently, about 9 percent of the nation’s liquid fuel supply comes from biofuels — most of it corn-based ethanol. And by 2022, Congress has mandated that biofuel levels reach 36 billion gallons.

But developing biofuels has been tricky, and Mr. Tillerson has not been alone in his skepticism. Many environmental groups and energy experts have been critical of corn-derived ethanol, because of its lower energy content and questionable environmental record.

According to Exxon, algae could yield more than 2,000 gallons of fuel per acre of production each year, compared with 650 gallons for palm trees and 450 gallons for sugar canes. Corn yields just 250 gallons per acre a year.

Exxon’s partnership with Synthetic Genomics is also a vote of confidence in the work of Dr. Venter, a maverick scientist best known for decoding the human genome in the 1990s. In recent years, he has focused his attention on a search for micro-organisms that could be turned into fuel.

“Algae is the ultimate biological system using sunlight to capture and convert carbon dioxide into fuel,” Dr. Venter said.

Algal biofuel, sometimes nicknamed oilgae by environmentalists, is a promising technology. Fuels derived from algae have molecular structures that are similar to petroleum products, including gasoline, diesel and jet fuel, and would be compatible with the existing transportation infrastructure, according to Exxon.

Continental Airlines, for example, has demonstrated the fuel’s viability in a test flight of an airplane powered in part by algae-based fuel.

The Pentagon has also been looking at alternative fuels, including algae, to reduce the military’s dependence on oil.

And while cost-effective mass production of algae has eluded researchers so far, it holds potential advantages over other sources of biofuels. Algae can be grown in areas not suited for food crops, using pools of brackish water or even farming them in seawater.

Algae also has another benefit, which could eventually help cut greenhouse gas emissions that cause global warming. Like any plant, it needs carbon dioxide to grow. But Exxon and Synthetic Genomics hope to genetically engineer new strains of algae that can absorb huge amounts of carbon dioxide — like that emitted by power plants, for example.

Exxon’s investment includes $300 million for in-house studies and “potentially more” than $300 million to Synthetic Genomics “if research and development milestones are successfully met,” Exxon said.

...the rest of the article is pretty interesting and briefly describes some of the science behind it. i think exxon squashes it.

oops. would a mod be so kind as to remove Advertise on NYTimes.com from the title? thanks.

revefsreleets

07-15-2009, 11:08 AM

I hope they succeed. However, it will be EXPENSIVE...good thing the oil companies are profitable so they have money to invest. Good thing that POS "Windfall tax" didn't get rammed down their throats.

Also, most importantly, if and when someone finds a good viable alternative, we should them be able to discuss a real cap and trade tax. It would make sense....then!

tony hipchest

07-15-2009, 11:24 AM

agreed. i hope this is an honest effort to find that viable alternative and not just profit protecting. the skeptic in me says this deal with synthetic genomics is a case of " keep your friends close and your enemies closer".

i remember when start ups like Fuel Cell and Human Genome were all the rage and so promising, but it just seems big oil and pharmaceuticals will do just about anything to not see their profits drop.

X-Terminator

07-15-2009, 11:25 AM

This is something that needed to be done 20 years ago, IMO, and it's been the oil companies who have been standing in the way, every step of the way, so that they don't lose their cash cow. There's no reason why we shouldn't be leading the world right now in alternative fuels. I, too, hope Exxon succeeds and the other oil companies get on board.

revefsreleets

07-15-2009, 11:34 AM

There is NO reason that any private company couldn't have been working on alternative fuels. NOTHING was stopping them. There's been government money available. The big oil companies don't care, because the entire infrastructure is set up do run on petrol. There's no conspiracy...it's just not been considered profitable, and there IS a near infinite supply of coal and oil on this planet (peak oil is a scam).

Fire Haley

07-17-2009, 01:34 AM

woo-hoo!

$20 Oil This Year on ‘Devastating’ Crude Glut

July 16 (Bloomberg) -- Crude oil will collapse to $20 a barrel this year as the recession takes a deeper toll on fuel demand, according to academic and former U.S. government adviser Philip Verleger.

A crude surplus of 100 million barrels will accumulate by the end of the year, straining global storage capacity and sending prices to a seven-year low, said Verleger, who correctly predicted in 2007 that prices were set to exceed $100. Supply is outpacing demand by about 1 million barrels a day, he said.

“The economic situation is not getting better,” Verleger, 64, a professor at the University of Calgary and head of consultant PKVerleger LLC, said in a telephone interview yesterday. “Global refinery runs are going to be much lower in the fall. If the recession continues and it’s a warm winter, it’s going to be devastating.”

http://www.bloomberg.com/apps/news?pid=20601087&sid=auTu3RI8WC1A

revefsreleets

07-17-2009, 06:55 AM

That hurts Russia and Venezuela, as well as the Saudi's.

Hmmmm....sounds like a good deal to me. $1 a gallon gas? Fill up the trunk, baby!

drewcary

07-20-2009, 02:35 AM

for all those still programmed to think that man made global warming exists.

http://video.google.com/videoplay?docid=288952680655100870

MasterOfPuppets

07-20-2009, 08:36 AM

hey !!! then they slap another dollar per gallon tax on it !!! ....i mean since were already used to 3 + per gallon, why confuse people ??? :laughing:

revefsreleets

07-20-2009, 09:55 AM

hey !!! then they slap another dollar per gallon tax on it !!! ....i mean since were already used to 3 + per gallon, why confuse people ??? :laughing:

I only WISH that were a joke. Friedman has been a long-term advocate of this...the fact that it would destroy the economy (since consumer confidence will be largely pined to fuel costs), and probably send us spiraling into a depression just when there are signs we may be heading out of recession seems completely lost on these people.

We have a big problem. People are starting to wonder and worry about these huge deficits Obama is piling up. There's NO chance he's going to cut spending on anything, so we are left with huge new taxes. They ARE coming...